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See how Tennessee is using FM outsourcing to drive service, savings and efficiencies — now for higher education

by Brianna Crandall — June 2, 2017 — Professional real estate and investment services firm JLL has entered into a new contract with the State of Tennessee to manage state-owned properties, including public colleges and universities that choose to leverage Tennessee’s innovative facilities management (FM) program.

Success of Tennessee’s FM outsourcing program, initiated in 2013, drove the state’s decision to include more state properties for professional management and maintenance. Results of the initial project, which included 10 percent of state properties, yielded better service and more than $26 million in savings through fiscal year 2016 (including $6 million in utility savings). It is on track for $40 million in savings by the end of 2017 and $50 million in five-year taxpayer savings by June 30, 2018.

World-class professional management of state-owned properties is proving transformative for Tennessee — improving the quality of service in facilities and generating substantial financial savings for the citizens of our state. We are excited that Tennessee has become a national model that other states desire to emulate, and has been celebrated with innovation awards from major organizations that recognize Tennessee as a leader in facilities management. We look forward to continuing our relationship with JLL and driving the same kinds of efficiencies to other branches of Tennessee government.

Tennessee’s FM outsourcing program has gained national recognition for efficiency and innovation. The National Association of State Chief Administrators (NASCA) and the National Association of State Procurement Officers presented major innovation awards to Tennessee in 2014 and 2016. On May 3-4, NASCA hosted officials from 15 states that are considering replicating Tennessee’s program to improve quality of facilities maintenance while lowering overall costs to taxpayers.

JLL has achieved savings at State of Tennessee facilities by creating efficiencies for maintenance, security, janitorial and landscaping services; implementing preventive maintenance; and adding technology systems that reduce energy costs.

Tom Foster, JLL executive vice president, stated:

Since 2013, JLL has worked alongside the Tennessee Department of General Services to realize efficiencies and improvements in building management, maintenance and energy savings. Through this program, we have demonstrated a consistent commitment to providing State of Tennessee employees the opportunity to improve their careers and compensation potential by joining our team and gaining a higher level of professional training.

According to the new contract, Tennessee can direct certain state departments to outsource facilities management. State-owned colleges and universities will have the option to leverage JLL FM outsourcing services and are encouraged to explore the opportunity to improve facilities management and lower costs.

Under new contract terms, JLL is required to keep all current employees in newly managed JLL facilities. State employees begin that process by completing a questionnaire, drug screening and background check. Employees that transition to JLL will have a compensation package, including benefits, equitable to their state compensation. Employees who transitioned from the State of Tennessee to JLL under the 2013 contract today earn, on average, approximately 38 percent more than when they were employed by Tennessee, says JLL.

JLL serves as the prime service provider with contract service partners Diversified Maintenance and BrightView Landscapes. JLL has had a long-time Tennessee presence providing commercial real estate services. JLL today has offices in Memphis and Nashville and employs more than 300 Tennesseans. Diversified Maintenance employs more than 325 Tennesseans and has offices in Memphis and Nashville. BrightView Landscape Services, with Nashville and Memphis branches, employs more than 200 Tennesseans and serves clients that include Williamson County Schools and some of the nation’s largest companies.

The trend on higher education campuses to utilize private professionals is decades old and now commonplace, notes JLL. Many higher education institutions outsource to specialized professional firms for services that includes building management and maintenance, food services, landscaping and grounds, campus bookstores and retail, security, parking and special event ticketing. Outsourcing has reportedly proven effective to increase quality, reduce costs, and enable schools to focus on their education mission.

Combined, JLL, Diversified Maintenance and BrightView Landscapes reportedly have dozens of service contracts with both public and private institutes of higher education. Those include Harvard University, Arizona State University, Samford University, Auburn University, Louisiana State University, Vanderbilt University, Tennessee State University and University of Tennessee College of Veterinary Sciences.